Best practice policy design and harmonisation of support schemes for electricity from renewable energy sources (RES-E) within the European Union have been discussed controversially for years. In contrast, policies for improving renewable heating (RES-H) penetration in the European Member States and options for best practice instruments are still being developed. The objective of this paper is to analyse different levels of policy harmonisation for target compliance and the economics of renewable heating and cooling. After presenting the degree of RES-H policy harmonisation resulting from Directive 2009/28/EC, a quantitative assessment is performed of the costs and benefits of different harmonisation scenarios. This selects the obligation to use renewable heating in buildings as the common policy instrument against which the effects of harmonisation are analysed. The paper shows that economic benefits can result from implementing best practice design options for use obligations in EU Member States. (c) 2011 Elsevier Ltd. All rights reserved.